The Adani Group won bids for six airports despite the Ministry of Finance and NITI Aayog raising objections about the 2019 bidding process, The Indian Express reported on Friday, citing documents accessed by it.
Earlier, Newsclick had reported on how the Narendra Modi-led government bypassed norms to allow the Adani Group to gain entry into the airport business.
The Centre had privatised the airports at Ahmedabad, Lucknow, Jaipur, Mangaluru, Guwahati and Thiruvananthapuram, and Guwahati in 2019. The Adani group won the right to operate them for 50 years, surpassing even established players like GMR in the bidding process.
Records accessed by The Indian Express show that the Public Private Partnership Appraisal Committee had on December 11, 2018, discussed the Ministry of Civil Aviation’s proposal for the privatisation of the airports.
The Department of Economic Affairs had suggested in a note that not more than two airports be given to the same bidder because of the huge financial risk involved in the project. This note, dated December 10, was not even discussed at the Public Private Partnership Appraisal Committee meeting.
“These six airports projects are highly capital-intensive projects, hence it is suggested to incorporate the clause that not more than two airports will be awarded to the same bidder duly factoring the high financial risk and performance issues,” the department said in the note. “Awarding them to different companies would also facilitate yardstick competition.”
To substantiate its point, the Department of Economic Affairs cited the example of the Delhi and Mumbai airports. It said that GMR group was not given both the airports even though the company was the only qualified bidder.
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The DEA had also pointed out that neither the Airports Authority of India nor the Ministry of Civil Aviation had given a break up of the project costs or key performance indicators to the committee, according to Newsclick. The DEA noted that it would be difficult to compare the bidders’ proposals without these important details.
The NITI Aayog had also raised its concerns about the bidding on the same day as the DEA. “A bidder lacking sufficient technical capacity can well jeopardise the project and compromise the quality of services that the government is committed to provide,” it said.
Responding to the objections, the Public Private Partnership Appraisal Committee said that prior experience with airports may neither be made a “prerequisite for bidding, nor a post-bid requirement”.
One year after winning the bids, the Adani Group went on to sign concession agreements for the Ahmedabad, Lucknow, and Mangaluru airports. It asked for a delay in takeover till February 2021 amid the coronavirus crisis, citing difficulties related to the transition process. The three airports were given to the group in November 2020.
In September, the group had signed concession agreements for the Guwahati, Jaipur and Thiruvananthapuram airports.
In August, the group announced that it had acquired 74% stake in Chhatrapati Shivaji Maharaj International Airport in Mumbai. The acquisition also gave the Adanis ownership of the upcoming Navi Mumbai Airport, in which Mumbai International Airport Limited holds 74% stake.
Scroll.in has also previously looked at how the Adani Group expanded its presence across India since 2014 by examining the financial statements of several companies under it. Before expanding its footprint into airport business, the group was already the country’s largest private port operator, coal miner and importer, private power producer, city gas distributor and importer of edible oils.
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